Petco Health and Wellness Co Inc - Class A
Q4 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.44%.
Did WOOF Beat Earnings? Q4 2026 Results
Petco Health & Wellness posted a mixed fourth-quarter fiscal 2025 report, delivering a narrow bottom-line miss while edging past revenue expectations in a quarter that told two very different stories at once. The company lost $0.01 per share, falling well short of the $0.02 consensus estimate by 144.44%, even as net sales of $1.52 billion came in 0.54% above expectations, though that top line still represented a 2.4% year-over-year decline. The most compelling driver behind the period was aggressive cost discipline: operating income surged 83.2% to $31.86 million and Adjusted EBITDA climbed 10.6% to $106.29 million, with management noting results came in well above their own outlook. For the full fiscal year, the turnaround was stark, with Petco swinging to net income of $9.07 million from a loss of $101.82 million. Looking ahead, CEO Joel Anderson signaled a shift toward growth, with fiscal 2026 guidance calling for net sales flat to up 1.5% and Adjusted EBITDA of $415 million to $430 million, as the company targets a return to positive comparable sales.
- Gross margin expansion of 37 basis points to 38.3% in Q4
- SG&A reduction drove operating income growth of 83.2% in Q4
- Comparable sales declined 1.6% in Q4
- Adjusted EBITDA margin improved to 7.0% from 6.2% in Q4
- Inventory fell 9.7% versus 2.5% decline in sales for full year
- Leverage ratio improved from 4.2x to 3.0x
“In fiscal 2025, we strengthened our leadership team and rebuilt the foundation of our economic model, enabling us to exceed our profitability goals. With that work largely complete, we are entering the next phase of our strategy focused on driving sustainable, profitable top-line growth.”
Petco Health & Wellness CEO, on the earnings call
Forward Guidance & Outlook
For fiscal 2026, Petco guides net sales flat to up 1.5% year-over-year, Adjusted EBITDA of $415 million to $430 million, net interest expense of approximately $125 million, capital expenditures of approximately $140 million, depreciation & amortization of approximately $200 million, and approximately 15-20 net store closures. For Q1 2026, the company expects net sales down 1% to flat year-over-year and Adjusted EBITDA of $92 million to $94 million. The outlook assumes a return to positive comparable sales in 2026, that current or planned tariffs remain at March 11, 2026 levels, economic conditions remain generally consistent, and fuel prices normalize by end of Q1.
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Figures from SEC filings and company reports. Not investment advice.